aNewDomain — Cuba has two paper currencies — the Peso and the Convertible Peso or CUC. CUCs are worth about $1 and Pesos, which are used for government salaries, are worth about $.04. But what happens when bitcoin is thrown into the mix?
Bitcoincuba is a movement to infuse bitcoin into the Cuban economy, and it seems to already be working. Here is a compliation of screenshots taken from a bitcoin transaction that occurred at a new WiFi hotspot in Cuba.
The original video from which the screenshots were taken is here, as well as an in-depth article on Cuban bitcoin.
Fernando Villar, the founder of bitcoincuba and person responsible for the video and inaugural bitcoin transaction in Cuba, said of the event:
It’s about showing Cubans and the Bitcoin community that it is now possible to receive Bitcoin through Nauta, the Cuban state-run public Wi-Fi … This will hopefully open everyone’s eyes on the possibilities and finally put Cuba on the Bitcoin map.”
Villar was also interviewed in a TV Marti report, where he gets into an in-depth discussion of the founding of bitcoincuba and its importance in the country. (Note: The video is in Spanish.)
What Happens Now?
I’ve never owned or transacted in bitcoin myself. But it seems obvious that this method of payment would be a fairly easy way for Cubans to make money through outsourced work or sales without the Cuban government, or even regulators in the US, knowing. A non-trackable form of paid work would be a big deal for the country, which is heavily regulated.
The current two-currency situation in Cuba distorts the economy. While I’m not an economist, I have read enough to believe that if Cuba were to convert to a single currency, the CUC for example, it would be problematic and cause unfairness as wages change.
So, how does bitcoin figure into all of this, and will the Cuban government care?
For aNewDomain, I’m Larry Press.
Ed: A version of this story ran on Larry Press’ laredcubana. Read it here.
Featured image: Bitcoin Wallpaper by Jason Benjamin via Flickr
Body image: Screenshots by Larry Press